PBOC Guides Yuan to Stronger Level

Surprise Move Suggests Beijing May Be Ready to End Yuan's Fall

SHANGHAI—The Chinese central bank surprised markets Monday by guiding the yuan to its strongest level against the U.S. dollar in more than two months amid fresh signs the economy is stabilizing after a recent slowdown.

The move by Beijing was in contrast to largely stable foreign-exchange markets elsewhere, which suggested to some analysts that Beijing may be ready to end the yuan's roughly 3% fall this year.